Varsity teacher opposes using N1.3 trillion to service debts while borrowing N1.8tr

A PROFESSOR of Economics in the University of Abuja, Prof. Sule Magaji, has frowned at plan by the Federal Government to use N1.36 trillion to service debts while borrowing a higher sum of N1.8 trillion within the same budget year in a depressed economy.

In his view, the recovered loot should be converted to use in the financial year rather than a resort to borrowing.

“The paradox of the budget is the proposed debt service of N1.36 trillion. This is really too much for a depressed economy…. Although debt is an obligation, it reveals the rising debt profile of the country. The contradiction is that why should Nigeria service loans to this tune and at the same time plan to borrow a higher amount of N1.8 trillion?

“This means that the burden of debt service is made to increase for 2017 budget and the country trapped in to the vicious cycle. The way out of this conundrum is that the recovered loot can be substituted for the proposed domestic and foreign debts,” Magaji said.

However, the university teacher in his analysis of the budget to The Guardian was full of praises for the budget.

According to him: “Contrary to the established belief that Nigerian Federal Government budgets (are) mere yearly and ceremonial rhetoric, the change mantra re-attracts the attention of the populace to re-embrace the idea that the budget can be a powerful economic strategy capable of addressing the multifaceted societal problem of unemployment, low output, import dependency, low literacy rate, insecurity, among others.”

While noting that the five per cent allocated to education fell far below the 26 per cent prescribed by UNESCO, he applauded the N369.6 billion allocated to the sector, which he said, had been neglected for long.

His words: “At least the sector now outstrips a number of sectors in the budgetary allocation. However, five per cent is far below the prescribed UNESCO’s 26 per cent of a country’s yearly budget for educational sector. Nigeria can nevertheless bridge the short fall by using other measures such as the trust funds, external grants and related assistances.”

The Economics professor lauded the policy on teacher recruitment and training, which he noted, was capable of lessening the teachers’ shortage in our basic schools. Together with the proposed entrepreneurship training for market women, traders and artisans and the planned re-introduction of vocational training, he added, would reduce youths’ unemployment

Magaji, who noted that unless the Naira regains strength against other currencies and attains stability, the size of the budget is immaterial, added: “Nevertheless, the Federal Government can closely monitor and ensure that the planned productive measures in the economy yield immediate result. This can ultimately reduce import dependence and stabilise the Naira.”

He said that the novel departure from over-dependence on oil revenue was an indication of a strong desire to diversify the revenue base and the economy.